Based on analyzing the relationship of total factory overhead (Y) to direct labor hours (X). The following relationship was found:
Y = $1,000 + $2X
The equation was probably found through the use of which of the following mathematical techniques?
A) Linear programming.
B) Multiple regression analysis.
C) Simple regression analysis.
D) Excel tools.
E) Nonlinear regression.

Question

Quizplus · Accepted Answer

The equation given is a simple linear regression equation, which relates Y (total factory overhead) to a single independent variable X (direct labor hours). Therefore, the equation was likely found through simple regression analysis. Linear programming is a method used to optimize a problem with linear relationships between variables, and multiple regression analysis would involve more than one independent variable. Nonlinear regression would involve a nonlinear relationship between the variables. Excel tools may have been used to perform the calculations, but it is not a specific mathematical technique.

Based on Analyzing the Relationship of Total Factory Overhead (Y)